David James Deming

For-Profit Colleges

For-profit, or proprietary, colleges are the fastest-growing postsecondary schools in the nation, enrolling a disproportionately high share of disadvantaged and minority students and those ill-prepared for college. Because these schools, many of them big national chains, derive most of their revenue from taxpayer-funded student financial aid, they are of interest to policy makers not only for the role they play in the higher education spectrum but also for the value they provide their students. In this article, David Deming, Claudia Goldin, and Lawrence Katz look at the students who attend for-profits, the reasons they choose these schools, and student outcomes on a number of broad measures and draw several conclusions. First, the authors write, the evidence shows that public community colleges may provide an equal or better education at lower cost than for-profits. But budget pressures mean that community colleges and other nonselective public institutions may not be able to meet the demand for higher education. Some students unable to get into desired courses and programs at public institutions may face only two alternatives: attendance at a for-profit or no postsecondary education at all. Second, for-profits appear to be at their best with well-defined programs of short duration that prepare students for a specific occupation. But for-profit completion rates, default rates, and labor market outcomes for students seeking associate’s or higher degrees compare unfavorably with those of public postsecondary institutions. In principle, taxpayer investment in student aid should be accompanied by scrutiny concerning whether students complete their course of study and subsequently earn enough to justify the investment and pay back their student loans. Designing appropriate regulations to help students navigate the market for higher education has proven to be a challenge because of the great variation in student goals and types of programs. Ensuring that potential students have complete and objective information about the costs and expected benefits of for-profit programs could improve postsecondary education opportunities for disadvantaged students and counter aggressive and potentially misleading recruitment practices at for-profit colleges, the authors write.

School Accountability, Postsecondary Attainment and Earnings

We study the impact of accountability pressure in Texas public high schools in the 1990s on postsecondary attainment and earnings, using administrative data from the Texas Schools Project. Schools respond to the risk of being rated Low Performing by increasing student achievement on high-stakes exams. Years later, these students are more likely to have attended college and completed a four-year degree, and they have higher earnings at age 25. However, we find no overall impact of accountability pressure to achieve a higher rating, and large negative impacts on attainment and earnings for the lowest-scoring students.

Can States Take Over and Turn Around School Districts? Evidence From Lawrence, Massachusetts

The Every Student Succeeds Act (ESSA) requires states to identify and turn around struggling schools, with federal school improvement money required to fund evidence-based policies. Most research on turnarounds has focused on individual schools, whereas studies of district-wide turnarounds have come from relatively exceptional settings and interventions. We study a district-wide turnaround of a type that may become more common under ESSA, an accountability-driven state takeover of Massachusetts’s Lawrence Public Schools (LPS). A differences-in-differences framework comparing LPS to demographically similar districts not subject to state takeover shows that the turnaround’s first 2 years produced sizable achievement gains in math and modest gains in reading. We also find no evidence that the turnaround resulted in slippage on nontest score outcomes and suggestive evidence of positive effects on grade progression among high school students. Intensive small-group instruction over vacation breaks may have led to particularly large achievement gains for participating students.

Skill Requirements across Firms and Labor Markets: Evidence from Job Postings for Professionals

We study variation in skill demands for professionals across firms and labor markets. We categorize a wide range of keywords found in job ads into 10 general skills. There is substantial variation in these skill requirements, even within narrowly defined occupations. Focusing particularly on cognitive and social skills, we find positive correlations between each skill and external measures of pay and firm performance. We also find evidence of a cognitive social skill complementarity for both outcomes. As a whole, job skills have explanatory power in pay and firm performance regressions beyond what is available in widely used labor market data.